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Taxation

Panel wants civic body to hike property tax rates

Tuesday, 29 June 2010 10:06 administrator
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Indian Express    29.06.2010

Panel wants civic body to hike property tax rates

Ayesha Arvind Tags : property tax rates hike, delhi Posted: Tue Jun 29 2010, 00:53 hrs

New Delhi:  Ticking off the Municipal Corporation of Delhi (MCD) for its poor property tax collection, the Third Municipal Valuation Committee (MVC), in its final report, has recommended that the MCD increase its tax base or hike property tax rates especially since real estate prices have gone up across the Capital. The MVC has further recommended a consequent re-categorisation of 200 MCD colonies to increase revenues of around Rs 500 crore per annum.

In its report submitted before Chief Secretary Rakesh Mehta and Municipal Commissioner K S Mehra last week, the MVC, constituted by the Delhi government to review property tax rates, has said that the real estate value across the Capital has gone up by 40 per cent in the past three years, while the Corporation has managed to collect a mere 25 per cent of its tax targets.

The MVC has recommended that 17 colonies currently falling under Category B of house tax be upgraded to Category A. It has further suggested that MCD re-categorise 62 C category colonies, upgrading those to Category B and 57 D category colonies to Category C. The re-categorisation has been recommended based on road connectivity, proximity to markets and malls, road length, civic facilities and connectivity.

The re-categorisation, say MCD officials, is imperative, considering MCD’s dismal tax collections since the unit area method of tax computation was introduced in 2004. This change, if implemented, will result in a huge jump in property tax.

Areas under the jurisdiction of MCD are at present divided into categories A to H depending on the infrastructural facilities there. Any colony that has a grading of 89 or more in terms of facilities etc, comes under Category A while Category B has gradings between 75 and 88. At present, there are 28 Category A colonies in Delhi, where the tax rates are higher. These include categories like New Friends Colony, Vasant Vihar, Shanti Niketan, South Extension among the many. But the committee’s is only an interim report and while enhancing annual valuation comes under the jurisdiction of Municipal Valuation Committee, the implementation of increase in tax rates is the exclusive jurisdiction of the deliberative wing of the MCD.

Last Updated on Tuesday, 29 June 2010 10:08
 

Panel proposes upgrading some colonies for tax

Tuesday, 29 June 2010 08:43 administrator
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The Times of India      29.06.2010

Panel proposes upgrading some colonies for tax

Ruhi Bhasin, TNN, Jun 29, 2010, 12.18am IST
 
NEW DELHI: With property prices rising in the city over the years, the third municipal valuation committee's interim report has recommended that the MCD should either widen its tax base or go for a hike in tax.

The committee has also proposed a re-categorization of over 200 colonies, out of a total of 3,000, observing that the move will augment the civic agency's revenues by around Rs 500 crore per annum.

In its report submitted to the chief secretary, Rakesh Mehta, and the MCD commissioner, K S Mehra, last week, the committee — constituted by Delhi government to review property tax in the city — has said that property prices across the capital have risen by 40% in the past three years while the civic agency has managed to collect just 25% of the tax that can be mopped up.

The report has proposed that 17 colonies that are now in category B should be upgraded to A, 62 C category colonies be put in category B and 57 D category colonies be promoted to category C.

"The criteria for re-categorising a colony includes its proximity to a market area or malls, road network, whether it is a DDA planned colony or not, the civic facilities available there and the Metro," said an MCD official. "Any colony located within 500 metres of a Metro line will have to pay more tax."

For a 100 square metre property, under the jurisdiction of MCD, the current annual property tax rate is approximately Rs 5,670, Rs 5,000, Rs 3,000 and Rs 2,500 for properties in categories A, B, C and D, respectively.

If MCD accepts the recommendations of the committee, there will be a major change in the tax slab for upgraded colonies. Areas under the jurisdiction of MCD are at present divided into categories A to H. At present, there are 28 category A colonies in Delhi. These include areas like New Friends Colony, Vasant Vihar and Shanti Niketan. Category B includes colonies like Defence Colony and GK-I.

"There has been a decline in property tax collections since the unit area method for calculating property tax was introduced in 2004," said an MCD official. "The panel's report is, however, only an interim report and the decision to increase tax rates is the exclusive jurisdiction of the deliberative wing of the MCD." Similar proposals were made by the committee in 2007 but they were not implemented by MCD.
 

Commercial spaces to pay sewage cess

Monday, 28 June 2010 06:18 administrator
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Deccan Chronicle      28.06.2010

Commercial spaces to pay sewage cess

June 28th, 2010

Hyderabad, June 27: People using sewer network have to pay sewage cess to the Hyderabad Metropolitan Water Supply and Sewerage Board that maintains the sewer network in city hereafter.

Sewage cess will be levied from July 1. Presently, sewage cess is being paid by only those people having drinking water connection. Several individual houses, commercial establishments like cinema halls, showrooms, function halls, hospitals, nursing homes, hotels and lodges among others, which do not have water connection, are using sewer network without any sewage cess being levied on them.

Now, the Water Board has decided to levy and collect sewage cess from all such category of consumers. The Water Board has got the permission to go ahead with sewage cess from the Chief Minister, Mr K. Rosaiah.

Since its inception the Water Board has been collecting sewage cess only from those having drinking water connections. The sewage cess is included in the monthly water bill, at the rate of 35 per cent of the total water bill. For example, the minimum monthly bill for domestic connection is Rs 126, of which Rs 90 is water tariff and remaining sewage cess including service charges.

The Board’s contention is though several establishments do not have water connection, they are using the sewerage network being maintained by the Board and are liable to pay sewerage cess.

Apart from commercial establishments, hospitals and nursing homes with 25 beds capacity will be levied with Rs 1,500, for 26-50 beds it will be Rs 2,000 and for 51-100 beds it will be Rs 10,000. Likewise, hotels and lodging with 50 rooms have to pay Rs 2,000 sewage cess, and those with rooms between 51 and 100 have to pay Rs 10,000.

 
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